U.S. Trade Gap Registers Surprise Drop

Oct. 9, 2009
Largest drop since May

The trade deficit narrowed for the first time in four months in August on higher exports driven by a weak dollar and lower imports amid lackluster domestic demand, the government said on Oct. 9.

The goods and services trade gap fell 3.6% to $30.7 billion from a revised $31.9 billion in July, the Commerce Department reported. Most analysts had expected a $33 billion deficit on the back of a possible import jump fueled by a recovery from prolonged recession.

In percentage terms, the August deficit dip was the largest recorded since May, figures showed.

August exports rose slightly to $128.2 billion while imports fell to $158.9 billion.

The trade deficit in goods narrowed by two percent to $41.9 billion in August, while the trade surplus in services widened by 2.7% to $11.2 billion.

Exports of goods were virtually unchanged at $86.8 billion and imports decreased to $128.7 billion.

Exports of services increased to $41.4 billion and imports decreased to $30.2, the government data showed.

The trade deficit with Canada, the largest U.S. trading partner, narrowed by 27.9% to $1.5 billion in August while the deficit with Mexico, the second largest export destination and third largest import destination, widened by 34.6% to $4 billion.

The politically sensitive trade deficit with China narrowed by less than 1% to $20.2 billion, and the deficit with Japan widened by 11.6% to $4.3 billion.

The dollar had depreciated against the currencies of most of its major trading partners, making its exports more competitive.

Copyright Agence France-Presse, 2009

About the Author

Agence France-Presse

Copyright Agence France-Presse, 2002-2024. AFP text, photos, graphics and logos shall not be reproduced, published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP shall not be held liable for any delays, inaccuracies, errors or omissions in any AFP content, or for any actions taken in consequence.

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!